Managing Climate-Related Risks: NBIM's Strategy Ahead

In Short

• NBIM publishes its 2030 Climate Action Plan for net zero emissions by 2050.
• The fund links investment objectives to climate goals and engages with companies for realistic climate targets.
• AI and analytics are applied to rationalise climate risk management and reporting.

Norges Bank Investment Management (NBIM) has published its 2030 Climate Action Plan to manage climate-related risks and explore climate-related opportunities in its investment portfolio.

According to NBIM’s CEO, Nicolai Tangen, climate risk is financial risk, and the fund’s long-term returns depend on the global economy’s response to physical climate risks and the energy transition.

He added, “The global economy cannot outrun climate change, so neither can our investments.”

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The 2030 plan firms up the earlier 2025 Climate Action Plan and presents five strategic priorities to map out the fund’s transition toward net zero emissions by 2050.

These priorities include linking investment objectives to climate goals, engaging with companies to set realistic climate targets and transition plans, promoting global standards for climate and nature-related disclosures, increasing attention to nature, adaptation, and physical climate risk, and using AI and analytics to improve climate risk management and reporting.

Also Read: NBIM Urges Banks to Reveal Businesses Excluded from Emissions Data

Carine Smith Ihenacho, NBIM’s Chief Governance and Compliance Officer, concluded by saying that,” We will continue to support and challenge our portfolio companies to decarbonise their operations and business models.”

Ends/

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Source: NBIM